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Serious drawdown of oil quotes

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Serious drawdown of oil quotes
May 28
09:00 2020

Today, oil is actively declining. A very significant increase in the reserves of “black gold” in the United States caused this drop. Moreover, the fears that Russia will not reduce production in July also made the oil fall.

At 8.13 Moscow time, oil futures of the European Brent crude oil fell by 1.73% and were trading at around $ 34.14 per barrel. During yesterday’s session the asset ended in the negative zone; the fall has amounted to 1.43 US dollars or 3.95%.

At the same time, July oil contracts of WTI crude oil declined 3.2% and cost $ 31.76 per barrel. On Wednesday, futures fell in price by 4.48% or $ 1.54.

Analysts believe that the reason for such low prices is the problems with the recovery of demand, which is not going to seriously grow due to the pandemic and the resumption of the trade conflict between the United States and China. 

The statistics released yesterday by the American Petroleum Institute (API) also made the price fall. It became known that US oil reserves in the week ended on May 22, had grown by 8.7 million barrels. In storage, gasoline has increased 1.1 million barrels, distillates – 6.9 million barrels.

Official statistics from the US Department of Energy regarding the energy reserves will be published tonight.

The experts of the Moody’s rating agency have changed the medium-term forecast for oil prices downward (from 50-70 to 45-65 US dollars per barrel). Under the medium-term forecast the analysts understand the period from 3 to 5 years.

 

The material was prepared with the participation of Katya Wilson,
a leading analyst of the brokerage company UFT Group

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